Q. Once a lien is filed for nonpayment of maintenance, how long until the association can foreclose? Does foreclosing take a vote of the board? Can the unit be sold or must it be rented? One of our board members is a Realtor and expects to be the listing agent on rental or sale and collect a commission. Isn’t this a conflict? – J.F.
A. Unless this is your first delinquency, which is doubtful, your association should have been previously counseled on these questions. Whether your board has been lax or has not been advised by experienced counsel, it appears that your association needs a change in direction. If you are a condominium association, your association can foreclose on its lien in as little as 60 days. The period is extended to 90 days for homeowners associations. The decision to foreclose does require approval from the board. Single board members should not be making these decisions unless they have the proper advance approval from the board to direct legal counsel. If the association does foreclose and obtains title to the unit, the association has several options. The unit can be rented, which makes sense in a lot of cases if the unit is in reasonable condition. The unit typically cannot be sold if it remains subject to a first mortgage, but experienced legal counsel can advise you on how to apply pressure on the bank and obtain a great result for the association.
Q. My wife and I recently purchased a home from a resident in a new development. The clubhouse construction was delayed due to the economic downturn of the past few years, but is now under construction and will be finished by the end of the year. I suggested some equipment be included in the exercise facility but was told we will not have it. Apparently, there was a meeting several months before we purchased that spelled out the changes. I was quite upset and sent a complaint to our management company. An employee of the builder, who informed me that he was the president of our homeowners association, contacted me. Does he have any obligation to the homeowners? Are meetings required? Do we have recourse for decisions that he makes? – B.P.
A. The board members appointed by the developer do have a fiduciary obligation to act in the best interests of the homeowners. This creates a potential conflict of interest since the president in this case is also an employee of the developer, but it is absolutely the norm for developer employees to serve on the board until turnover. In most cases, the turnover process is smooth because these developer-appointed directors have been through many turnovers and are familiar with the developer’s duties under Florida law. In your case, the decision not to install certain exercise equipment is not typically a decision that is made by the homeowners. The board members make those decisions based on budget restrictions and what they believe is in your best financial interests as a homeowner. That being said, board decisions should be made at a properly noticed meeting. You do have recourse against board members who violate their duties, but you do not likely have extra recourse against this president merely because he is also a developer employee. My advice on this issue is to be patient until turnover and then the homeowners will have the ability to manage the association’s money and property.
Q. We recently conducted the annual fire sprinkler inspection for our condo association. During this process we were not able to gain entry to several units due to keys not working or no keys on file. In light of the recent storm and reports of water intrusion, our board president wanted our condo association manager to check all the units that appear vacant for possible water intrusion or signs of any damage to the units. What is the best and safest way to access these abandoned units to make sure there is not significant mold or water damage? – G.R.
A. It may not be stated in your condo documents, but the association does have the right under Chapter 718, Florida Statutes, to inspect possible damage to common elements and to make emergency repairs. The entry and inspection must be during reasonable hours. For any units that are known to be vacant and abandoned, I would not be concerned with posting a notice. For units that are occupied, and which you do not have a key or the owner is refusing access, the owner will be responsible for any damage that occurs for refusing to provide access. If you have to change any of the locks to gain access, I would send a short notice to the owners’ last known address informing them that the association is keeping the new key to the unit at the association’s office, which was made necessary by their failure to provide emergency access.
Q. Our homeowners association has successfully garnished rents for about 12 months from a tenant who occupies a delinquent home. We have collected $1,000 every month from the tenant, but now the tenant claims that his new lease for the home requires him to pay only the HOA dues as the full rent. On a monthly basis, this would only allow us to garnish a little more than $200 dollars each month if that is the actual lease. Can we demand more since this new lease is way below market rent and could be a sham against the HOA? – L.N.
A. In this scenario, Section 720.3085 of the Florida Statutes allows your HOA to “demand that the tenant pay to the association the subsequent rental payments and continue to make such payments until all the monetary obligations of the parcel owner related to the parcel have been paid in full to the association.” Unfortunately, the statute does not require that the tenant pay at least market rent. Your association can garnish whatever the tenant is legally obligated to pay to his landlord under the lease agreement. In your case, it could be a legitimate deal or the landlord could be instructing the tenant to turn over only a portion of the rent. Either way, the association is on solid ground to request a copy of the lease agreement and also cancelled checks to verify the actual rents owed. If the tenant or landlord cannot provide this support, the association should take a firm stance as this is clearly below market rent.